I was wondering if there was any software that can process video on the go. For example I need to merge few video inputs (see image) and then pass the processed video to software that streams video live.
Is this really possible?
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I have used a freeware software program "VH Multi Camera Studio" to do something similar to what you describe. While it is still possible to find and download that program (just Google the name), it seems the developer no longer supports it.
The modern incarnation of the company exists as http://www.splitmedialabs.com/ but I have no experience with it in its new form.
I'm sure that is possible. I'm not aware of any software that does exactly that, but I work for a company that does something similar. I am a developer at Isys Global, and we make a web-based solution kind of like that. We capture multiple video feeds, process them in real-time, and can stream them online. We do not merge the videos into a single video, but our web-based player allows you to watch the live videos simultaneously over the web.